Vermont, California and Idaho were among the 10 states with the most patent activity in 2011, according to the State Entrepreneurship Index by the University of Nebraska-Lincoln. Here's what's triggering the innovation.

. Oregon

Engineers at Oregon State University have developed breakthrough technologies, such as transparent transistors.

Patents per thousand residents: 2.44

In Oregon, several state initiatives have helped spur innovation.

For example, the Signature Research Centers have opened up research labs and provided grants to inventors and startups working on ideas with commercial potential.

And Oregon State University is actively courting private industry collaboration to fund research, said Richard Spinrad, the school's vice president for research. Private investment is up 42% over the past two years, and the number of licensing deals for university patents is soaring.

A few successes: Over 60% of the wheat grown in Oregon is licensed from wheat breed developed at the university. Engineers at Oregon State have developed transparent transistors licensed, in conjunction with Hewlett-Packard(HPQ), for use in flatscreen TVs, PC displays and tablets.